US stocks mixed following key labor market data

Investing.com -- US stock futures traded in mixed fashion on Thursday, attempting to stabilize after a rocky start to the month amid a raft of key employment data that could provide clues into upcoming Federal Reserve monetary policy decisions. 

By 09:55 ET (13:55 GMT), the 30-stock Dow Jones Industrial Average had slipped by 96 points or 0.2%, while the benchmark S&P 500 had added 9 points, or 0.2%, and tech-heavy Nasdaq Composite had increased by 110 points, or 0.6%. Private payrolls miss expectations

US private payrolls rose by less than anticipated in August, in the latest sign of an ongoing, albeit gradual, slowdown in the American labor market.

Private payrolls increased by 99,000 jobs in August, compared to a downwardly revised total of 111,000 in July, according to payrolls processor ADP. It was the weakest month for the figure since January 2021.

Economists had called for a reading of 144,000, up from the original July mark of 122,000.

"The job market's downward drift brought us to slower-than-normal hiring after two years of outsized growth," said ADP Chief Economist Nela Richardson in a statement.

Elsewhere on Thursday, separate data showed that the number of Americans filing for first-time unemployment benefits came in at 227,000 in the week ending on August 31, a decrease of 5,000 from the prior week's revised level of 232,000. Forecasts had seen the number in line with last week's initial mark of 231,000.

Although the returns will likely be closely monitored by markets, the key release of the week will be Friday's more comprehensive nonfarm payrolls report from the Labor Department's Bureau of Labor Statistics.

Economists are predicting that the US economy added 164,000 jobs last month, an increase from 114,000 in the prior month. The July total, which was far below expectations, sparked a broader market downturn as traders fretted over the possibility of a US recession.

The numbers come as the Federal Reserve gears up to hold their next two-day policy gathering on Sept. 17-18. Investors widely expect the central bank to slash borrowing costs -- currently standing at a 23-year high of 5.25% to 5.5% -- down by 25 basis points.

But analysts have said that any indications of an intensifying jobs market slowdown could persuade the Fed to introduce larger rate cuts. Traders now see a 45% chance of the Fed lowering rates by an outsized 50 basis points when it meets later this month, and have priced in more than 100 bps worth of cuts by the end of the year.

Helping this belief were comments from Atlanta Fed President Raphael Bostic, who warned that the employment picture could see "disruptions" if interest rates remain too high for much longer.

Verizon linked with Frontier

Verizon (NYSE:VZ ) is in the spotlight after the Wall Street Journal reported that the telecoms giant is in advanced talks to purchase Frontier Communications (NASDAQ:FYBR ), marking a deal that would help boost the firm's fiber network.

An announcement of the acquisition may come as soon as this week, the WSJ said, citing people familiar with the matter.

US Steel (NYSE:X ) stock rose slightly, after slumping over 17% on Wednesday, on reports that US President Joe Biden is set to block its proposed $14.9 billion takeover by Japan's Nippon Steel due to national security concerns.

US Steel has said that failing to close the deal could put thousands of US union jobs at risk and may force it to shutter some steel mills.  Crude bounces from multi-month lows

Crude prices advanced Thursday, after plunging to multi-month lows, on reports that major producers may delay an output increase as well as falling US inventories.

By 05:45 ET, the Brent contract gained 0.8% to $73.29 per barrel, after falling in the previous session to the lowest close since June 27, 2023, while U.S. crude futures (WTI) traded 0.8% higher at $69.75 a barrel, after dropping on Wednesday to the lowest settlement since Dec. 11.

The market found support after American Petroleum Institute data showed U.S. crude oil fell by 7.431 million barrels last week, more than the 1 million barrel draw expected.

The Organization of the Petroleum Exporting Countries and allies led by Russia, known as OPEC+, is discussing delaying its oil output increase scheduled to start in October, Reuters reported on Wednesday, citing sources.

Peter Nurse contributed to this report.

Source: Investing.com